UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 or 15(d) of the SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 24, 2002 USA NETWORKS, INC. (Exact name of Registrant as specified in charter) Delaware 0-20570 59-2712887 (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification No.) 152 West 57th Street, New York, NY 10019 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 314-7300 ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE On April 24, 2002, the Registrant issued a press release announcing its results for the quarter ended March 31, 2002. The full text of this press release, appearing in Exhibit 99.1 hereto, is incorporated herein by reference. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (c) Exhibits. 99.1 Press Release of USA Networks, Inc. dated April 24, 2002. 99.2 Supplemental Information. ITEM 9. REGULATION FD DISCLOSURE A copy of the Registrant's supplemental information, appearing in Exhibit 99.2 hereto, is furnished pursuant to Regulation FD. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. USA NETWORKS, INC. By: /s/ Julius Genachowski -------------------------------- Name: Julius Genachowski Title: Executive Vice President and General Counsel Date: April 24, 2002 EXHIBIT INDEX Exhibit No. Description 99.1 Press Release of USA Networks, Inc. dated April 24, 2002. 99.2 Supplemental Information.
[USA NETWORDS INC. LOGO] FOR IMMEDIATE RELEASE APRIL 24, 2002 USA REPORTS STRONGEST GROWTH IN ITS HISTORY 58% EBITDA GROWTH FROM OPERATING BUSINESSES MARGINS EXPAND DRAMATICALLY NEW YORK, April 24, 2002 - USA Networks, Inc. (NASDAQ: USAI), to be renamed USA Interactive upon closing of the contribution of USA Entertainment to a joint venture to be controlled by Vivendi Universal, reported results today for its quarter ended March 31, 2002. On a comparative pro forma basis reflecting the pending Vivendi transaction, USA reported the following ($ in millions, except per share): (a) See definitions on page 2. (b) 2001 data is pro forma for the adoption of FAS 141/142, the new accounting rules which eliminate amortization of goodwill. 2002 results are before after-tax expense of $310.6 million related to the cumulative effect of adoption of FAS 141/142. See page 7 for further details. (c) All references to EBITDA refer to Adjusted EBITDA, as defined on page 2. HIGHLIGHTS o HSN-U.S. grew EBITDA(c) by 26% to $57.7 million on 13% higher revenue. HSN's operating margin expanded to 14.6% from 13.1% in the previous year, due primarily to higher gross margins. HSN currently expects to meet its EBITDA budget of $285 million for 2002. o Ticketmaster grew ticketing EBITDA by 11% to $33.7 million on 2% higher revenue. Ticketing's operating margin expanded to 22% from 20% in the previous year, due primarily to lower variable costs and leveraging its fixed cost base. o Match.com grew EBITDA over 25 times to $6.9 million on 196% higher revenue. Match.com ended the quarter with 527,662 subscribers, a 178% increase over Q1 2001. o USA's online travel companies continue to experience robust growth. Expedia maintains its status as the world's leading online travel service, with $1.1 billion in gross bookings in Q1. Expedia grew EBITDA over six-fold to $34.6 million on 103% higher revenue. HRN grew EBITDA 63% to $25.8 million on 57% higher revenue. o USA's operating margins improved dramatically. The operating businesses expanded EBITDA margins to 16.8% from 13.1%, and the combined businesses grew margins to 13.1% from 8.5%. o USA currently expects to exceed its budgeted 2002 operating revenue by 2% and operating EBITDA by 11%. This would bring 2002 growth in operating EBITDA to 50%, vs. budgeted growth of 34%. Further, USA expects to exceed its budgeted 2002 operating income by 2%. -More-
Q1 2002 Q1 2001 GROWTH ------- ------- ------ REVENUE: Operating Businesses $926.6 $751.1 23% Total 1,007.1 877.9 15% ADJUSTED EBITDA (A): Operating Businesses $155.6 $98.6 58% Total 131.6 74.3 77% EPS: Diluted EPS from Continuing Operations (b) $0.00 ($0.05) NM Cash Net Income EPS (a) 0.05 0.01 400% 2 of 8 SEGMENT FINANCIAL RESULTS On a comparative pro forma basis reflecting pending transactions, USA reported the following ($ in millions): (a) HSN Germany reported revenue and EBITDA (net of Euro's exchange rate fluctuation), respectively, of $59.6 million and $1.0 million in Q1 2002, vs. $65.2 million and $4.7 million in Q1 2001. (b) In order to present comparable results for HSN Germany, the results have been translated from Euros to U.S. dollars at a constant exchange rate. (c) 2001 amounts reflect estimated results generated by homes lost by HSN following the sale of USA Broadcasting to Univision. 2002 amounts reflect disengagement related sales rebates offered to customers impacted by disengagement. ADJUSTED EBITDA, also referred to as EBITDA in this release, is defined as operating income plus (1) depreciation and amortization, (2) amortization of cable distribution fees ($13.0 million & $8.8 million, in Q1 2002 and 2001, respectively), (3) amortization of non-cash distribution, marketing, and compensation expense, and (4) disengagement related payments to cable operators, marketing expenses and sales rebates ($11.5 million in Q1 2002) related to the transfer of HSN's distribution to cable (which has been accomplished). CASH NET INCOME ("CNI") is defined as net income available to common shareholders plus (1) amortization of non-cash distribution, marketing, and compensation expense (2) amortization of goodwill (in 2001) and intangibles and (3) minority interest related to Holdco. Shares outstanding to compute CNI EPS is defined as actual shares outstanding plus 33.2 million shares of Holdco that are exchangeable into USA common stock. Related to Holdco, the Company has the right to issue common stock for all remaining exchangeable shares. CNI EPS amounts are shown on a fully diluted, treasury method basis, including the impact of dilutive securities. ATTRIBUTABLE ADJUSTED EBITDA - OPERATING BUSINESSES is defined as Adjusted EBITDA from Operating Businesses, less the percentage of Adjusted EBITDA attributable to minority shareholders of USA's public subsidiaries. This percentage is determined based on fully diluted, treasury method shares as of March 31, 2002. -More-
Q1 2002 Q1 2001 GROWTH --------- --------- -------- REVENUES - OPERATING BUSINESSES HSN - U.S. $396.2 $349.2 13% Ticketing 153.4 150.1 2% Hotel Reservations Network 165.7 105.3 57% Expedia 116.0 57.2 103% PRC 70.1 80.7 -13% Match.com 25.3 8.5 196% --------- --------- -------- SUB-TOTAL $926.6 $751.1 23% REVENUES - EMERGING BUSINESSES Citysearch and related 7.3 12.4 ECS / Styleclick 12.1 8.6 HSN - international and other (a) 81.5 83.4 --------- --------- SUB-TOTAL $100.9 $104.4 --------- --------- Euro's exchange rate fluctuation (b) (16.5) (13.7) Disengaged HSN Homes (c) (0.9) 36.2 Intersegment Elimination (3.0) 0.0 --------- --------- TOTAL $1,007.1 $877.9 15% ========= ========= ======== ADJUSTED EBITDA - OPERATING BUSINESSES HSN - U.S. $57.7 $45.7 26% Ticketing 33.7 30.2 11% Hotel Reservations Network 25.8 15.8 63% Expedia 34.5 4.5 661% PRC 5.7 10.0 -43% Match.com 6.9 0.3 2503% Corporate and other (8.7) (7.9) -10% --------- --------- -------- SUB-TOTAL $155.6 $98.6 58% ADJUSTED EBITDA - EMERGING BUSINESSES Citysearch and related (10.7) (11.8) ECS / Styleclick (8.5) (16.9) HSN - international and other (a) (4.6) (0.8) --------- --------- SUB-TOTAL ($23.8) ($29.4) --------- --------- Euro's exchange rate fluctuation (b) (0.3) (0.9) Disengaged HSN Homes (c) 0.0 6.0 --------- --------- TOTAL $131.6 $74.3 77% ========= ========= ======== ATTRIBUTABLE ADJUSTED EBITDA - OPERATING BUSINESSES $116.7 $80.6 45% ========= ========= ======== 3 of 8 CAPITALIZATION The company reported shares outstanding, as of April 15, 2002, and net cash and other securities, as of March 31, 2002, of the following (amounts in millions): USA's aggregate market capitalization, pro forma for the pending Vivendi transaction, was $15.2 billion as of April 15, 2002. (a) Fully diluted shares. Includes treasury method options and warrants, exchangeable shares and other dilutive securities, and includes Vivendi's remaining 56.6 million USA shares that may be delivered to USA in connection with USA's Series B preferred interest in VUE, which will be issued to USA in the pending Vivendi transaction. (b) Includes USA's consolidated cash including that of USA's public subsidiaries and an advance receivable to Universal of $19.7 million which will be paid at the close of the Vivendi transaction. Excludes cash due to clients at Ticketmaster. Pro forma attributable net cash is $2.6 billion, which accounts for minority ownership of USA's public subsidiaries on a fully diluted, treasury method basis. (c) Includes securities to be issued to USA in the pending Vivendi transaction, as follows: Series A preferred interest and 5.4% common interest in VUE at balance sheet carrying values, and Series B preferred interest in VUE, at the lesser of the March 31, 2002 market value of 56.6 million shares ($1.8 billion), and the accreted face value of the Series B Preferred interest (initially $1.75 billion). OPERATING HIGHLIGHTS HSN - U.S. - -------------------------------------------------------------------------------- o HSN's gross profit increased 200 basis points to 35.5%, driven by a stronger inventory position in 2002, with inventory levels declining 12% year over year, and a shift toward higher margin products. o Off-air revenue increased 40% over last year, driven by record upsells and roll-out of the new waitlist business. Customer take rates on upsells are up 26% since last year. o HSN.com grew revenue 128% over Q1 2001 to $43 million. o HSN continues to improve the customer experience, reducing its customer service related calls by 13%. In addition, since opening the fulfillment center in Fontana, CA, HSN is shipping packages to West Coast customers 40% faster than in the year-ago period. o Health and beauty products grew sales 20% over last year, driven by the popularity of the Andrew Lessman, Serious Skin Care and Elariia brands. o Emmy-Award winner Christopher Lowell successfully debuted 10 new products on HSN, 6 of which sold out completely, generating sales that were more than 100% above plan. Christopher's after-show online chat attracted the largest such audience on HSN.com, illustrating the powerful link between HSN's on air and online channels. -More-
PRO FORMA FOR PRE- VIVENDI DEAL VIVENDI DEAL ------------- ------------ Fully Diluted Shares Outstanding (a) 477 796 Consolidated Net Cash (b) $2,917 $1,298 Face Value of Preferred Issued in Expedia Transaction $656 $656 Securities in Vivendi Universal Entertainment ("VUE") (c) $3,264 $0 4 of 8 TICKETMASTER/MATCH.COM/CITYSEARCH - -------------------------------------------------------------------------------- o Ticketing continues to migrate online at a fast clip. 38% of tickets were sold online in Q1, versus 30% last year. This trend increased during the quarter, with 40% of tickets sold online in March, and Ticketmaster is on track to meet its goal of 45% of ticket sales online by year-end. o Ticketmaster was named the official ticketing provider and supporter of the 2004 Olympic Games in Athens. o Top-selling events were U.S. Hot Rod Association Monster Truck Events, Ringling Brothers, Blink 182, N*SYNC and JOHN HANCOCK CHAMPIONS ON ICE 2002 OLYMPIC TOUR. o TicketFastTM, Ticketmaster's electronic ticketing product, is now installed in 70 venues. o Match.com ended the quarter with 527,662 subscribers, a 178% increase over the year ago period and a 38% increase over Q4 2001. o Match.com accelerated its international expansion with the acquisition of Soulmates Technology, a global provider of online dating services in approximately 25 countries. o Citysearch significantly increased monthly unique users to 7.1 million in March 2002 from 4.0 million in March 2001, and was named a "50 Best Website" by Time Magazine. o Evite sent 7.7 million invitations this quarter, up 60% from last year. Evite increased monthly unique users 81% to 1.5 million in March. HOTEL RESERVATIONS NETWORK - -------------------------------------------------------------------------------- o On March 25, HRN unveiled its new brand and website, WWW.HOTELS.COM, with superior technology and improved tools such as personalization, mapping functions, and enhanced customer service. o HRN also launched a multi-million dollar marketing campaign, which has demonstrated great results in drawing people to the new site. Already, hotels.com is producing 7-10% of HRN's bookings, and most of these sales appear to be incremental. o HRN beat its daily booking record on February 27th, with over $3 million in bookings. o In total, HRN sold over 1.4 million room nights in Q1, a 76% increase over the previous year. o HRN now has over 6,000 properties, gaining a record 1,500 properties in Q1. This is as many properties as the company added in its first 9 years in business. o HRN and Spirit Airlines announced that HRN will be the exclusive lodging provider for Spirit, which is the largest privately-held airline in the world. o HRN announced that Hilton Hotel Corporation approved the participation by all of its corporately owned and managed Hilton and Doubletree broanded hotels in the HRN distribution Network. -More- 5 of 8 EXPEDIA - -------------------------------------------------------------------------------- o On February 4th, USA closed its acquisition of a majority stake in Expedia. o Merchant revenues were $57.7 million, or 50% of revenues, surpassing agency revenues for the first time. Agency revenues were $51.7 million, or 44% of revenues. o Expedia expanded its average reach to 11 million monthly unique users, and at the same time increased its conversion ratio to 5.8% from 5.7% in the year-ago quarter. o Expedia announced marketing agreements with major airlines including Continental Airlines, Delta Airlines and Alaska Airlines -- providing consumers with values such as exclusive promotions, better deals within packages and discounted webfares. o Expedia.com(R) launched the Walt Disney World Resort store, a one-stop shop where travelers can create vacation packages to the Orlando area, including stays at Walt Disney World Resort Hotels and theme park tickets. o Expedia's WWTE continued its growth. In January, Expedia launched WWTE with Frontier Airlines for hotel and car. In February, British Airways became the first international partner to have local language private label versions of Expedia's lodging services on its US, UK, French and German sites. o Expedia closed its acquisition of Classic Custom Vacations, the premier packager of high end Hawaii vacations, adding to its vacations business and expanding its distribution channels to traditional travel agents. PRECISION RESPONSE CORPORATION - -------------------------------------------------------------------------------- o PRC's business continues to be affected by the economy-related slowdown in the outsourcing of customer care programs, particularly in the telecom and financial services industries. However, PRC did grow Q1 revenue by 1% from Q4, reversing the negative sequential trend that existed in 2001. o During the quarter, PRC signed customer service deals with Target, BillPoint, Lodging.com, and expanded existing client relationships with American Express, AT&T and Federal Express. OTHER HIGHLIGHTS - -------------------------------------------------------------------------------- o USA announced plans to purchase TV Travel Group, which operates 24-hour travel commerce TV networks in the U.K. and Germany. Management of TV Travel Group will oversee USA's planned travel commerce network. -More- 6 of 8 OPERATING METRICS -More-
ALL HOUSEHOLD NUMBERS FOR HSN AS OF END OF PERIOD. Q1 2002 Q1 2001 GROWTH ------- ------- ------ HSN - U.S. Units Shipped (mm) 9.6 8.6 12% Gross Profit % 35.5% 33.5% Return Rate 19.0% 19.6% Average price point $45.41 $50.06 Product mix: Homegoods 39% 41% Jewelry 24% 26% Health / Beauty 24% 19% Apparel / Accessories 13% 14% HSN cable / DBS homes (mm) 72.6 68.4 6% HSN total homes (mm) 74.9 80.2 HSN total homes pro forma for disengagement (mm) 74.9 68.9 9% America's Store FTE's (mm) 11.2 8.4 33% HSN - INTERNATIONAL AND OTHER - Households AVG. LIVE CONSOLIDATED SERVICES: HRS. DAILY STAKE ---------- ----- HSE - Germany (includes Austria/Switzerland) 29.8 29.7 0.3% 16 42% Home Shopping Espanol (U.S.) 4.7 4.5 4.4% 9 100% Home Shopping Espanol (Mexico) 2.4 -- NM 3 100% UNCONSOLIDATED SERVICES: TVSN (China) (HH airing at least 14 hrs/week) 16.9 16.8 0.7% 10 21% Shop Channel (Japan) 11.9 9.4 26.6% 16 30% HSE - Italy 9.4 9.4 0.0% 11 41% HSE - Netherlands (includes Belgium) 3.6 1.6 125.0% 8 47% HSE - France (includes Belgium / Luxembourg) 3.5 1.5 133.3% 5 47% HSE - U.K. (launched 10/01) 6.0 -- NM 12 47% TICKETMASTER Number of tickets sold (mm) 23.9 23.6 1.5% Gross value of tickets sold (mm) $997 $937 6.4% Revenue per ticket $5.97 $5.96 0.2% Share of tickets sold online 37.8% 29.5% Online ticketing revenue $62.2 $49.6 25.4% MATCH Paid Subscribers 527,662 189,532 178.4% New Registrations 2,911,700 1,054,729 176.1% New Subscriptions 342,405 121,659 181.4% Conversion rate (registration to subscription) 11.8% 11.5% HOTEL RESERVATIONS NETWORK Hotel room nights sold (000s) 1,408 799 76.2% Average daily rate $115.70 $124.35 -7.0% Cities served 218 135 61.5% Properties 6,058 3,084 96.4% Affiliates (including TravelNow) 25,755 18,649 38.1% EXPEDIA Gross bookings (000s) (a) $1,107,000 $674,000 64.2% Total transactions (000s) (b) 3,045 1,780 71.1% Average Media Metrix reach (000s) (c) 11,242 6,969 61.3% Expedia.com conversion (d) 5.8% 5.7% New purchasing customers (000s) (e) 1,316 671 96.1% Cumulative purchasing customers (000s) (f) 7,610 3,603 NM Unique purchasing customers (000s) (g) 1,874 1,007 86.1% PLEASE SEE FOOTNOTES ON NEXT PAGE. 7 of 8 FOOTNOTES (a) Gross bookings represents the total value of travel booked through the Expedia, VacationSpot, and WWTE sites. (b) Transactions represents the number of reservations and purchases transacted through the Expedia and WWTE sites. (c) Average monthly Media Metrix reach represents the unduplicated reach for the Expedia and VacationSpot sites. (d) Conversion represents the monthly average Expedia.com unique monthly purchasers divided by the monthly average Media Metrix reach for the Expedia.com site. (e) Expedia new purchasing customers represents the number of new customers transacting through the Expedia sites in a quarter. (f) Expedia cumulative purchasing customers represents the cumulative number of customers that have ever transacted through the Expedia sites as of the end of a quarter. (g) Expedia quarterly unique purchasing customers represents the number of unique customers transacting through the Expedia sites over the course of a quarter. USA ENTERTAINMENT On April 23, USA shareholders overwhelmingly approved the transaction in which the Company's Entertainment Group would be contributed to a joint venture with Vivendi Universal called Vivendi Universal Entertainment ("VUE"). The transaction is expected to close in early May. Below are summary results for USA Entertainment (consists of USA Cable, Studios USA and USA Films): ADOPTION OF NEW ACCOUNTING RULES FOR GOODWILL As USA has stated in previous publicly filed documents, effective January 1, 2002, all calendar year companies were required to adopt FAS 141/142, the new accounting rules for goodwill and other intangible assets. The new rules eliminated amortization of goodwill and other intangible assets with indefinite lives and established new measurement criterion for these assets. The company recorded a pre-tax write-off of $499 million related to the Citysearch and Precision Response (PRC) businesses. Although Citysearch and PRC are expected to generate positive cash flows in the future, due to cash flow discounting techniques required by the new rules, the future cash flows do not support current carrying values. The Citysearch write-off was $115 million, and the PRC write-off was $384 million. Goodwill recorded in Q1 2001 was $58.4 million. ANALYST CONFERENCE CALL USA Networks, Inc. will audiocast its conference call with analysts and investors discussing the company's fourth quarter financial results on Wednesday, April 24, 2002, at 11:00 a.m. Eastern Time (ET). The live audiocast is open to the public, and a replay will be available approximately one hour after its completion, at www.usanetworks.com/investor.relations. -More-
Q1 2002 Q1 2001 GROWTH ------- ------- ------ Revenue $405.0 $492.1 -17.7% EBITDA 116.3 160.7 -27.6% 8 of 8 IMPORTANT DISCLOSURES / LEGEND AND FORWARD LOOKING STATEMENTS / FOOTNOTES This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are necessarily estimates reflecting the best judgment of the senior management of USA and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements should, therefore, be considered in light of various important factors, including those set forth herein and in the documents USA files with the Securities and Exchange Commission. Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include, without limitation: material adverse changes in economic conditions generally or in the markets served by USA, material changes in inflation, future regulatory and legislative actions affecting USA's operating areas, competition from others, product demand and market acceptance, the ability to protect proprietary information and technology or to obtain necessary licenses on commercially reasonable terms, the ability to expand into and successfully operate in foreign markets, and obtaining and retaining skilled workers and key executives. The words "estimate," "project," "intend," "expect," "believe" and similar expressions are intended to identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. USA does not undertake any obligation to update or revise these forward-looking statements, whether as a result of new information, future events or any other reason. The financial, statistical and other information contained in this press release and its attachments is unaudited. ABOUT USA NETWORKS, INC. USA Networks, Inc. (Nasdaq: USAI), to be renamed USA Interactive upon the close of its pending transaction with Vivendi Universal, is organized into two groups, the Interactive Group and the Entertainment Group. The Interactive Group consists of Expedia, Inc. (Nasdaq: EXPE), Home Shopping Network (including HSN International and HSN Interactive); Ticketmaster (Nasdaq: TMCS), which operates Citysearch and Match.com; Hotel Reservations Network (Nasdaq: ROOM); Electronic Commerce Solutions; Styleclick (OTC: IBUYA); Precision Response Corporation; and will include TV Travel Group upon the close of the USA/TV Travel Group transaction. The Entertainment Group consists of USA Cable, including USA Network, SCI FI Channel, TRIO, Newsworld International, and Crime; Studios USA, which produces and distributes television programming; and USA Films, which produces and distributes films. CONTACTS: USA COMMUNICATIONS: USA INVESTOR RELATIONS: Ron Sato Roger Clark / Lauren Rosenfield 212-314-7254 212-314-7400 USA INTERACTIVE AND SUBSIDIARIES ALL AMOUNTS EXCLUDE ENTERTAINMENT ASSETS TO BE CONTRIBUTED IN THE PENDING VIVENDI TRANSACTION AND INCLUDE EXPEDIA FOR THE FULL PERIOD UNAUDITED BUSINESS SEGMENT INFORMATION ( $ IN THOUSANDS ) (a) In order to present comparable results for HSN Germany, the results have been translated from Euros to U.S. dollars at a constant exchange rate. (b) 2001 amounts reflect estimated results generated by homes lost by HSN following disengagement of USA Broadcasting to Univision. 2002 amount reflects disengagement related sales rebates offered to customers impacted by disengagement. (c) Ad EBjusted isITDA, de asfined op inerating plcome (1us, de) anpreciation amd (2ortization, am) ( ofortization cable distribution fees ($13,000 and $8,756, in Q1 2002 and 2001, respectively), (3) amortization of non-cash distribution and marketing expense and non-cash compensation expense and (4) disengagement related payments to cable operators, marketing expenses and sales rebates ($11,538 in Q1 2002) related to the transfer of HSN's distribution to cable (which has been accomplished). (d) Attributable Adjusted EBITDA- Operating Businesses is defined as Adjusted EBITDA from Operating Businesses, less the percentage of Adjusted EBITDA attributable to minority shareholders of USA's public subsidiaries. This percentage is determined based on fully diluted, treasury method shares as of March 31, 2002. F-1
THREE MONTHS ENDED MARCH 31, PRO FORMA PRO FORMA ----------------- --------------- 2002 2001 ----------------- --------------- REVENUES - OPERATING BUSINESSES HSN - U.S. $ 396,183 $ 349,220 Ticketing 153,379 150,109 Hotel Reservations Network 165,712 105,286 Expedia 116,006 57,222 PRC 70,089 80,692 Match.com 25,265 8,544 ----------------- --------------- SUB-TOTAL 926,634 751,073 REVENUES - EMERGING BUSINESSES Citysearch and related 7,275 12,384 ECS/Styleclick 12,084 8,572 HSN - international and other 81,534 83,408 ----------------- --------------- SUB-TOTAL 100,893 104,364 ----------------- --------------- Euro's exchange rate fluctuation (a) (16,545) (13,705) Disengaged HSN homes (b) (857) 36,152 Intersegment Elimination (2,989) - ----------------- --------------- TOTAL $ 1,007,136 $ 877,884 ================= =============== ADJUSTED EBITDA - OPERATING BUSINESSES (C) HSN - U.S. $ 57,717 $ 45,706 Ticketing 33,685 30,233 Hotel Reservations Network 25,794 15,822 Expedia 34,549 4,539 PRC 5,732 10,017 Match.com 6,872 264 Corporate and other (8,701) (7,937) ----------------- --------------- SUB-TOTAL 155,648 98,644 ADJUSTED EBITDA - EMERGING BUSINESSES (C) Citysearch and related (10,740) (11,751) ECS/Styleclick (8,465) (16,918) HSN - international and other (4,572) (769) ----------------- --------------- SUB-TOTAL (23,777) (29,438) ----------------- --------------- Euro's exchange rate fluctuation (a) (279) (936) Disengaged HSN homes (b) - 6,029 ---------------- ---------------- TOTAL $ 131,592 $ 74,299 ================ ================ - ATTRIBUTABLE ADJUSTED EBITDA- OPERATING BUSINESSES (D) $ 116,729 $ 80,622 ================ ================ USA INTERACTIVE AND SUBSIDIARIES ALL AMOUNTS EXCLUDE ENTERTAINMENT ASSETS TO BE CONTRIBUTED IN THE PENDING VIVENDI TRANSACTION AND INCLUDE EXPEDIA FOR THE FULL PERIOD UNAUDITED BUSINESS SEGMENT INFORMATION ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) (a) Represents costs incurred related to the disengagement of HSN from the USA Broadcasting stations. Amounts primarily relate to payments to cable operators and related marketing expenses in the disengaged markets. Note that an additional $857 of disengagement related sales rebates offered to customers impacted by disengagement is reflected net of revenue. (b) Amortization of warrants and stock issued in exchange for distribution and marketing services. (c) Expense relates to the Company's bonus stock purchase program, restricted stock awards and certain stock option grants. (d) Q1 '02 excludes cumulative effect expense from adoption of FAS 141/142 of $310,587 after tax and minority interest. Including this non-operating charge results in a diluted EPS of $(0.75) for Q1 '02. Q1 '01 is presented as if the new accounting rules for goodwill were effective as of January 1, 2001. The amount of goodwill in Q1 '01 was $37,702, after tax and minority interest. Including this goodwill results in a diluted EPS of $(0.15) for Q1 '01. (e) In relation to Expedia, the Company issued preferred stock with a dividend of 1.99%, payable in cash or stock. (f) Adjusted EBITDA, is defined as operating income plus, (1) depreciation and amortization, (2) amortization of cable distribution fees ($13,000 and $8,756, in Q1 2002 and 2001, respectively), (3) amortization of non-cash distribution and marketing expense and non-cash compensation expense and (4) disengagement related payments to cable operators, marketing expenses and sales rebates ($11,538 in Q1 2002) related to the transfer of HSN's distribution to cable (which has been accomplished). F-2
THREE MONTHS ENDED MARCH 31, PRO FORMA PRO FORMA ------------- ------------- 2002 2001 ------------- ------------- Revenues, net $ 1,007,136 $ 877,884 Operating costs and expenses: Costs related to revenues 628,134 568,167 Other costs and expenses 248,267 235,418 Disengagement costs (a) 10,681 - Amortization of non cash distribution and marketing expense (b) 11,023 8,017 Amortization of non cash compensation expense (c) 4,738 9,332 Amortization of cable distribution fees 13,000 8,756 Depreciation and amortization (d) 66,986 64,853 ------------- ------------- Total operating costs and expenses 982,829 894,543 ------------- ------------- Operating income 24,307 (16,659) Interest expense, net (4,224) (2,615) Other, net 12,873 18,597 ------------- ------------- Earnings before income taxes and minority interest 32,956 (677) Income tax expense (21,650) (24,730) Minority interest (4,072) 8,363 ------------- ------------- Earnings/(loss) before preferred dividend $ 7,234 $ (17,044) Preferred dividend (e) (3,264) (3,264) Net earnings/(loss) available to common shareholders ------------- ------------- from continuing operations (d) $ 3,970 $ (20,308) ============= ============= Diluted net loss available to common shareholders from continuing operations $ (451) $ (20,308) ============= ============= Cash net income from continuing operations $ 25,535 $ 4,057 ============= ============= Weighted average diluted shares 471,832 397,842 ============= ============= Weighted average CNI shares 471,832 456,277 ============= ============= EPS AVAILABLE TO COMMON SHAREHOLDERS FROM CONTINUING OPERATIONS Diluted loss per share available to common shareholders $ .00 $ (.05) ============= ============= Cash net income per share $ .05 $ .01 ============= ============= ADJUSTED EBITDA (F) $ 131,592 $ 74,299 ============= ============= USA INTERACTIVE AND SUBSIDIARIES EPS AND CASH NET INCOME RECONCILIATION INFORMATION UNAUDITED ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) F-3
THREE MONTHS ENDED MARCH 31, PRO FORMA PRO FORMA ---------- ---------- 2002 2001 ---------- ---------- DILUTED LOSS PER SHARE: Net earnings/(loss) before preferred dividend $ 7,234 (17,044) Impact of exchangeable shares and dilutive securities (4,421) -- Preferred Dividend (3,264) (3,264) ---------- ---------- DILUTED NET LOSS AVAILABLE TO COMMON SHAREHOLDERS (451) (20,308) Weighted average diluted shares 471,832 397,842 ========== ========== Diluted loss per share available to common shareholders $ .00 $ (.05) ========== ========== CASH NET INCOME: Net loss before preferred dividend $ 7,234 (17,044) Impact of exchangeable shares and dilutive securities (4,421) 340 Preferred Dividend (3,264) (3,264) Impact of non-cash items, net of tax and minority interest 25,986 24,025 ---------- ---------- CASH NET INCOME $ 25,535 4,057 ========== ========== Weighted average CNI shares 471,832 456,277 ========== ========== Cash net income per share $ .05 $ .01 ========== ========== RECONCILIATION OF BASIC AND CASH NET INCOME OUTSTANDING SHARES Basic weighted average shares 408,364 397,842 Exchangeable Holdco shares 33,217 33,217 Treasury Method Stock Options and Warrants 30,251 25,218 ---------- ---------- 471,832 456,277 ========== ========== USA NETWORKS, INC. AND SUBSIDIARIES BUSINESS SEGMENT INFORMATION - CONTINUING OPERATIONS UNAUDITED ( $ IN THOUSANDS ) (a) In order to present comparable results for HSN Germany, the results have been translated from Euros to U.S. dollars at a constant exchange rate. (b) Reflects estimated results generated by homes lost by HSN following disengagement of USA Broadcasting to Univision. 2002 amount reflects disengagement related sales rebates offered to customers impacted by disengagement. (c) Adjusted EBITDA, is defined as operating income plus, (1) depreciation and amortization, (2) amortization of cable distribution fees ($13,000 and $8,756, in Q1 2002 and 2001, respectively), (3) amortization of non-cash distribution and marketing expense and non-cash compensation expense and (4) disengagement related payments to cable operators, marketing expenses and sales rebates ($11,538 in Q1 2002) related to the transfer of HSN's distribution to cable (which has been accomplished). F-4
THREE MONTHS ENDED MARCH 31, ACTUAL ACTUAL ----------- ----------- 2002 2001 ----------- ----------- REVENUES - OPERATING BUSINESSES Cable and studios $ 367,259 $ 434,972 HSN - U.S. 396,183 349,220 Ticketing 153,379 150,109 Hotel Reservations Network 165,712 105,286 Expedia 80,519 -- PRC 70,089 80,692 Match.com 25,265 8,544 ----------- ----------- SUB-TOTAL 1,258,406 1,128,823 REVENUES - EMERGING BUSINESSES Citysearch and related 7,275 12,384 ECS/Styleclick 12,084 8,572 HSN - international and other 81,534 83,408 USA Films 30,743 51,006 Trio, NWI, Crime, other emerging media 6,976 6,163 ----------- ----------- SUB-TOTAL 138,612 161,533 ----------- ----------- Euro's exchange rate fluctuation (a) (16,545) (13,705) Disengaged HSN homes (b) (857) 36,152 Intersegment Elimination (7,048) -- ----------- ----------- TOTAL $ 1,372,568 $ 1,312,803 =========== =========== ADJUSTED EBITDA - OPERATING BUSINESSES (C) Cable and studios $ 126,324 $ 163,406 HSN- U.S. 57,717 45,706 Ticketing 33,685 30,233 Hotel Reservations Network 25,794 15,822 Expedia 25,371 -- PRC 5,732 10,017 Match.com 6,872 264 Corporate and other (9,293) (7,937) ----------- ----------- SUB-TOTAL 272,202 257,511 ADJUSTED EBITDA - EMERGING BUSINESSES (C) Citysearch and related (10,740) (11,751) ECS/Styleclick (8,465) (16,918) HSN - international and other (4,572) (769) USA Films (6,069) (1,033) Trio, NWI, Crime, other emerging media (3,409) (1,697) ----------- ----------- SUB-TOTAL (33,255) (32,168) ----------- ----------- Euro's exchange rate fluctuation (a) (279) (936) Disengaged HSN Homes (b) -- 6,029 Intersegment Elimination (4,059) -- ----------- ----------- TOTAL $ 234,609 $ 230,436 =========== =========== USA NETWORKS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) (a) Represents costs incurred related to the disengagement of HSN from the USA Broadcasting stations. Amounts primarily relate to payments to cable operators and related marketing expenses in the disengaged markets. Note that the additional $857 of disengagement related sales rebates offered to customers impacted by disengagement is reflected net of revenue. (b) Amortization of warrants and stock issued in exchange for distribution and marketing services. (c) Expense relates to the Company's bonus stock purchase program, restricted stock awards and certain stock option grants. (d) Q1 '02 excludes cumulative effect expense from adoption of FAS 141/142 of $310,587 after tax and minority interest. Including this non-operating charge results in a diluted EPS of $(0.73) for Q1 '02. Q1 '01 is presented as if the new accounting rules for goodwill were effective as of January 1, 2001. The amount of goodwill in Q1 '01 was $43,201, after tax and minority interest. Furthermore, Q1 '01 excludes cumulative effect expense from adoption of the new accounting rules for film accounting of $9,187, net of tax and minority interest. Including the goodwill and cumulative effect adjustment results in a diluted EPS of $(0.07) for Q1 '01. (e) In relation to Expedia, the Company issued preferred stock with a dividend of 1.99%, payable in cash or stock. (f) Adjusted EBITDA, is defined as operating income plus, (1) depreciation and amortization, (2) amortization of cable distribution fees ($13,000 and $8,756, in Q1 2002 and 2001, respectively), (3) amortization of non-cash distribution and marketing expense and non-cash compensation expense and (4) disengagement related payments to cable operators, marketing expenses and sales rebates ($11,538 in Q1 2002) related to the transfer of HSN's distribution to cable (which has been accomplished). F-5
THREE MONTHS ENDED MARCH 31, ACTUAL ACTUAL ----------- ----------- 2002 2001 ----------- ----------- Revenues, net $ 1,372,568 $ 1,312,803 Operating costs and expenses: Costs related to revenues 822,452 799,849 Other costs and expenses 316,364 282,518 Disengagement costs (a) 10,681 -- Amortization of non cash distribution and marketing expense (b) 6,964 8,017 Amortization of non cash compensation expense (c) 3,808 2,855 Amortization of cable distribution fees 13,000 8,756 Depreciation and amortization (d) 62,853 54,234 ----------- ----------- Total operating costs and expenses 1,236,122 1,156,229 ----------- ----------- Operating income 136,446 156,574 Interest expense, net (11,758) (11,416) Other, net (12,132) (6,522) ----------- ----------- Earnings before income taxes and minority interest 112,556 138,636 Income tax expense (32,180) (33,742) Minority interest (54,476) (79,075) ----------- ----------- Net earnings/(loss) from continuing operations $ 25,900 $ 25,819 Preferred dividend (e) (1,967) -- ----------- ----------- Net earnings available to common shareholders (d) $ 23,933 $ 25,819 =========== =========== Diluted net income available to common shareholders $ 22,838 $ 25,819 =========== =========== Cash net income $ 64,419 $ 95,373 =========== =========== Weighted average diluted shares 421,959 396,894 =========== =========== Weighted average cash net income shares 783,112 758,047 =========== =========== EPS FROM CONTINUING OPERATIONS Diluted loss per share available to common shareholders $ .05 $ .07 =========== =========== Cash net income per share $ .08 $ .13 =========== =========== ADJUSTED EBITDA (F) $ 234,609 $ 230,436 =========== =========== USA NETWORKS, INC. AND SUBSIDIARIES EPS AND CASH NET INCOME RECONCILIATION INFORMATION - CONTINUING OPERATIONS UNAUDITED ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) F-6
THREE MONTHS ENDED MARCH 31, ACTUAL ACTUAL --------- --------- 2002 2001 --------- --------- DILUTED LOSS PER SHARE: Net earnings before preferred dividend 25,900 $ 25,819 Impact of exchangeable shares and dilutive securities (1,095) -- Preferred Dividend (1,967) -- --------- --------- DILUTED INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 22,838 $ 25,819 Weighted average diluted shares 421,959 396,894 ========= ========= Diluted earnings per share available to common shareholders $ .05 $ .07 ========= ========= CASH NET INCOME: Net loss before preferred dividend $ 25,900 $ 25,819 Impact of exchangeable shares and dilutive securities 24,123 50,637 Preferred Dividend (1,967) -- Impact of non-cash items, net of tax and minority interest 16,363 18,917 --------- --------- CASH NET INCOME 64,419 $ 95,373 ========= ========= Weighted average CNI shares 783,112 758,047 ========= ========= Cash net income per share $ .08 $ .13 ========= ========= RECONCILIATION OF BASIC AND CASH NET INCOME OUTSTANDING SHARES Basic weighted average shares 393,736 370,176 Exchangeable Holdco shares 361,153 361,153 Treasury Method Stock Options 28,223 26,718 --------- --------- 783,112 758,047 ========= =========
USA Networks, Inc. (to be renamed USA Interactive) Pro Forma Segment Results $ in millions; rounding differences may exist. Unaudited.
------------ --------------- ------------------------------------------------------------------ REVENUE 1999 2000 2001 ------------ --------------- ------------------------------------------------------------------ YE 12/31 YE 12/31 Q1 Q2 Q3 Q4 YE 12/31 ------------ -------------- ------------- ----------- ----------- ------------- -------------- Operating Businesses HSN - U.S. $1,332.9 $1,527.0 $ 349.2 $ 356.5 $ 374.8 $ 469.4 $1,550.0 Ticketing 442.7 518.6 150.1 163.9 133.9 131.8 579.7 Hotel Reservations 161.8 328.0 105.3 138.3 151.2 141.7 536.5 Expedia 73.0 156.7 57.2 78.5 79.5 81.8 296.9 Precision Response 215.9 282.1 80.7 75.6 72.6 69.8 298.7 Personals 9.0 29.2 8.5 10.7 12.5 17.6 49.2 ------------ -------------- ------------- ----------- ----------- ------------- -------------- Sub-total 2,235.4 2,841.5 751.1 823.5 824.5 911.9 3,311.0 Emerging Businesses Citysearch and related 27.3 50.8 12.4 12.4 11.1 10.3 46.1 HSN - international and other 175.7 281.0 83.4 87.7 66.1 82.2 319.4 ECS/Styleclick 55.4 48.5 8.6 7.8 5.4 12.4 34.2 ------------ -------------- ------------- ----------- ----------- ------------- -------------- Sub-total 258.4 380.3 104.4 107.9 82.6 104.9 399.8 ------------ -------------- ------------- ----------- ----------- ------------- -------------- Non-recurring items 6.9 - - - - - - Foreign exchange conversion - (35.3) (13.7) (13.8) (9.1) (10.2) (46.9) Disengaged HSN Homes - 6.2 36.2 25.3 21.6 25.9 109.0 Intersegment Elimination - - - (2.6) (2.3) (2.2) (7.1) ------------- -------------- ------------- ----------- ----------- ------------- -------------- Total $2,500.7 $3,192.8 $ 877.9 $ 940.3 $ 917.3 $1,030.3 $3,765.8 ============= ============== ============= =========== =========== ============= ============== USA Entertainment USA Network $ 757.7 $ 804.2 $ 214.1 $ 220.6 $ 213.8 $ 184.7 $ 833.3 Sci-Fi Channel 198.5 274.9 69.3 70.0 63.1 71.4 273.9 Studios, net 348.6 446.0 151.5 152.5 121.1 100.9 526.0 Trio, NWI, Crime, other emerging 1.2 20.3 6.2 6.2 5.8 6.0 24.1 USA Films 82.1 86.1 51.0 62.6 16.0 37.5 167.0 ------------ -------------- ------------- ----------- ----------- ------------- -------------- Sub-total 1,387.9 1,631.5 492.1 511.8 419.8 400.5 1,824.3 ------------ -------------- ------------- ----------- ----------- ------------- --------------
------------------------------------------------------------------------------------ REVENUE 2002 ------------------------------------------------------------------------------------ Q1 Q2 Q3 Q4 YE 12/31 -------------------- --------------- --------------- --------------- --------------- Operating Businesses HSN - U.S. $ 396.2 Ticketing 153.4 Hotel Reservations 165.7 Expedia 116.0 Precision Response 70.1 Personals 25.3 -------------------- --------------- --------------- --------------- --------------- Sub-total 926.6 Emerging Businesses Citysearch and related 7.3 HSN - international and other 81.5 ECS/Styleclick 12.1 -------------------- --------------- --------------- --------------- --------------- Sub-total 100.9 -------------------- --------------- --------------- --------------- --------------- Non-recurring items - Foreign exchange conversion (16.5) Disengaged HSN Homes (0.9) Intersegment Elimination (3.0) -------------------- --------------- --------------- --------------- --------------- Total $ 1,007.1 ==================== =============== =============== =============== =============== USA Entertainment USA Network $ 185.0 Sci-Fi Channel 61.2 Studios, net 121.1 Trio, NWI, Crime, other emerging 7.0 USA Films 30.7 -------------------- --------------- --------------- --------------- --------------- Sub-total 405.0 -------------------- --------------- --------------- --------------- ---------------
------------ --------------- ----------------------------------------------------------------- Adjusted EBITDA 1999 2000 2001 ------------ --------------- ----------------------------------------------------------------- YE 12/31 YE 12/31 Q1 Q2 Q3 Q4 YE 12/31 ------------ -------------- ------------- ----------- ----------- ------------- -------------- Operating Businesses HSN - U.S. $ 214.7 $ 229.6 $ 45.7 $ 51.7 $ 45.9 $ 72.1 $ 215.4 Ticketing 93.3 100.0 30.2 35.5 19.0 21.5 106.2 Hotel Reservations 24.2 52.6 15.8 21.0 21.8 22.9 81.5 Expedia (44.3) (38.8) 4.5 17.7 16.4 22.2 60.9 Precision Response 30.4 44.6 10.0 10.2 7.9 6.2 34.3 Personals (0.4) 6.3 0.3 2.8 5.8 7.6 16.5 Corporate and other (36.1) (29.9) (7.9) (8.2) (8.1) (7.0) (31.2) ------------ -------------- ------------- ----------- ----------- ------------- ------------- Sub-total 281.7 364.5 98.6 130.8 108.7 145.4 483.6 Emerging Businesses Citysearch and related (60.4) (63.9) (11.8) (11.0) (10.8) (9.9) (43.4) HSN - international and other 11.8 14.7 (0.8) (1.6) (12.4) (7.7) (22.6) ECS/Styleclick (56.0) (71.2) (16.9) (14.5) (14.4) (7.8) (53.6) ------------ -------------- ------------- ----------- ------------------------- ------------- Sub-total (104.6) (120.4) (29.4) (27.1) (37.6) (25.4) (119.6) Non recurring items - (4.7) - (4.8) (12.3) (3.1) (20.1) Foreign exchange conversion - (3.9) (0.9) (1.0) 0.9 (0.2) (1.2) Disengaged HSN Homes - 0.9 6.0 3.5 3.0 3.6 16.1 ------------- -------------- ------------- ----------- ----------- ------------- ------------- Total $ 177.0 $ 236.3 $ 74.3 $ 101.5 $ 62.7 120.3 $ 358.8 ============= ============== ============= =========== =========== ============= ============ USA Entertainment USA Network $ 312.1 $ 395.2 $ 112.2 $ 119.3 $ 113.7 $ 84.9 $ 430.1 Sci-Fi Channel 68.9 101.7 29.7 27.8 23.9 26.1 107.5 Studios, net 52.9 50.8 21.5 20.2 17.6 15.9 75.2 Trio, NWI, Crime, other emerging (3.0) (7.1) (1.7) (2.4) (3.1) (4.4) (11.5) USA Films 6.4 (6.6) (1.0) 0.6 0.4 1.9 2.0 Corporate 0.0 0.0 0.0 0.0 0.0 0.0 0.0 ------------ --------------- ------------- ----------- ----------- ------------- ------------- Total 430.5 534.0 160.7 165.6 152.6 124.4 603.3 The financial, statistical and other information contained herein is unaudited. As filed with the Securities and Exchange Commission on April 24, 2002.
------------------------------------------------------------------------------------ Adjusted EBITDA 2002 ------------------------------------------------------------------------------------ Q1 Q2 Q3 Q4 YE 12/31 --------------------- --------------- --------------- --------------- --------------- Operating Businesses HSN - U.S. $ 57.7 Ticketing 33.7 Hotel Reservations 25.8 Expedia 34.5 Precision Response 5.7 Personals 6.9 Corporate and other (8.7) -------------------- --------------- --------------- --------------- --------------- Sub-total 155.6 Emerging Businesses Citysearch and related (10.7) HSN - international and other (8.5) ECS/Styleclick (4.6) -------------------- --------------- --------------- --------------- --------------- Sub-total (23.8) Non recurring items 0.0 Foreign exchange conversion (0.3) Disengaged HSN Homes 0.0 -------------------- --------------- --------------- --------------- --------------- Total $ 131.6 ==================== =============== =============== =============== =============== USA Entertainment USA Network $ 85.4 Sci-Fi Channel 15.6 Studios, net 25.3 Trio, NWI, Crime, other emerging (3.4) USA Films (6.1) Corporate (0.6) -------------------- --------------- --------------- --------------- --------------- Total 116.3 USA NETWORKS, INC. (TO BE RENAMED USA INTERACTIVE) Actual Results of Operations (As Reported) $ IN MILLIONS; ROUNDING DIFFERENCES MAY EXIST. UNAUDITED.
P&L 1999 2000 2001 YE 12/31 YE 12/31 Q1 Q2 Q3 Q4 ------- ------- ------- ------- ------- ------- Date Reported: 02/01/2001 01/29/2002 04/24/2002 07/25/2001 10/24/2001 01/29/2002 Revenues, net 3,371.7 4,596.2 1,312.8 1,369.7 1,255.8 1,346.5 Operating costs and expenses: Costs related to revenues 1,995.9 2,757.9 799.8 830.9 746.3 831.3 Other costs and expenses 754.7 1,027.6 282.5 289.5 312.4 298.3 Amort. of non-cash distribution and marketing expense 0.0 11.7 8.0 6.6 5.2 6.5 Depreciation 98.5 174.7 65.8 64.8 51.2 63.4 Amortization of goodwill 252.7 568.0 83.4 100.8 103.0 100.8 ------- ------- ------- ------- ------- ------- Total operating costs 3,101.8 4,539.8 1,239.6 1,287.3 1,218.1 1,300.4 ------- ------- ------- ------- ------- ------- Operating income 269.9 56.3 73.2 84.2 37.7 46.1 Interest expense, net (48.5) (34.2) (11.4) (12.9) (10.1) (14.0) Gain on sale of securities 89.7 0.0 0.0 0.0 0.0 0.0 Other, net 5.8 49.3 (6.5) (13.7) (12.9) (26.4) ------- ------- ------- ------- ------- ------- 46.9 15.1 (17.9) (26.6) (23.1) (40.4) ------- ------- ------- ------- ------- ------- Earnings before income taxes and minority interest 316.9 71.4 55.3 57.5 14.6 5.7 Income tax expense (103.1) (112.9) (26.5) (22.8) (21.9) (37.7) Minority interest (197.3) (47.1) (46.2) (45.0) (33.2) (25.0) ------- ------- ------- ------- ------- ------- Loss before cumulative effect of accounting change 16.5 (88.6) (17.4) (10.3) (40.4) (56.9) Cumulative effect of accounting change, net of tax 0.0 0.0 (9.2) 0.0 0.0 0.0 ------- ------- ------- ------- ------- ------- Net loss from continuing operations 16.5 (88.6) (26.6) (10.3) (40.4) (56.9) ======= ======= ======= ======= ======= ======= Preferred dividend 0.0 0.0 0.0 0.0 0.0 0.0 Net earnings available to common shareholders 16.5 (88.6) (26.6) (10.3) (40.4) (56.9) Weighted average diluted shares 367.9 359.7 396.9 373.8 376.4 377.1 ======= ======= ======= ======= ======= ======= Weighted average fully converted shares 721.0 747.4 758.0 763.4 737.6 760.9 ======= ======= ======= ======= ======= ======= Basic earnings per share $ .05 $ (.25) $ (.03) $ (.11) $ (.15) ======= ======= ======= ======= ======= ======= Diluted earnings per share $ .04 $ .07 $ (.03) $ (.08) ======= ======= ======= ======= ======= ======= Adjusted EBITDA 621.1 810.7 230.4 249.3 197.1 216.8 ======= ======= ======= ======= ======= ======= Excluding one-time charges and non-operating gains: Basic and diluted earnings per share $ (.01) $ (.25) $ (.02) $ (.08) $ (.13) ======= ======= ======= ======= ======= ======= Cash net income earnings per share $ (.14) $ .13 $ .20 $ .13 $ .04 ======= ======= ======= ======= ======= ======= THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on April 24, 2002. ** NOTE: THIS P&L DOES NOT GIVE AFFECT TO THE PENDING VIVENDI TRANSACTION.
P&L 2002 YE 12/31 Q1 Q2 Q3 Q4 YE 12/31 ------- ------- ------- ------- ------- ------- Date Reported: 01/29/2002 04/24/2002 Revenues, net 5,284.8 1,372.6 Operating costs and expenses: Costs related to revenues 3,208.4 822.5 Other costs and expenses 1,182.7 316.4 Amort. of non-cash distribution and marketing expense 26.4 7.0 Depreciation 245.3 90.3 Amortization of goodwill 388.0 0.0 ------- ------- ------- ------- ------- ------- Total operating costs 5,045.3 1,236.1 ------- ------- ------- ------- ------- ------- Operating income 241.2 136.4 Interest expense, net (48.4) (11.8) Gain on disposition of television station 0.0 0.0 Gain on sale of securities 0.0 0.0 Other, net (59.6) (12.1) ------- ------- ------- ------- ------- ------- (108.1) (23.9) ------- ------- ------- ------- ------- ------- Earnings before income taxes and minority interest 133.2 112.6 Income tax expense (108.9) (32.2) Minority interest (149.3) (54.5) ------- ------- ------- ------- ------- ------- Loss before cumulative effect of accounting change (125.1) 25.9 Cumulative effect of accounting change, net of tax (9.2) 0.0 ------- ------- ------- ------- ------- ------- Net loss from continuing operations (134.2) 25.9 ======= ======= ======= ======= ======= ======= Preferred dividend 0.0 (2.0) Net earnings available to common shareholders (134.2) 23.9 Weighted average diluted shares 374.1 422.0 ======= ======= ======= ======= ======= ======= Weighted average fully converted shares 765.3 783.1 ======= ======= ======= ======= ======= ======= Basic earnings per share $ (.34) ======= ======= ======= ======= ======= ======= Diluted earnings per share $ .05 ======= ======= ======= ======= ======= ======= Adjusted EBITDA 893.7 234.6 ======= ======= ======= ======= ======= ======= Excluding one-time charges and non-operating gains: Basic and diluted earnings per share $ (.34) ======= ======= ======= ======= ======= ======= Cash net income earnings per share $ .40 $ .08 ======= ======= ======= ======= ======= ======= USA Networks, Inc. (to be renamed USA Interactive) Operating Metrics IN MILLIONS EXCEPT PER UNIT THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. * In Q1 2002, HSN reclassfied certain items in its product mix. As such, wellness, ingestibles, and fitness categories were moved out of the Home Goods category and into the Health & Beauty category. Product Mix for 1999 and 2000 assuming reclassification not available. As filed with the Securities and Exchange Commission on April 24, 2002.
1999 2000 2001 2002 YE YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- HSN- US Units shipped 32.1 35.2 8.6 9.0 9.5 11.4 38.5 9.6 Gross profit % 34.3% 34.9% 33.5% 34.4% 34.3% 33.9% 34.0% 35.5% Return rate 20.3% 19.6% 19.6% 19.6% 19.0% 17.9% 19.0% 19.0% Product mix:* Homegoods N/A N/A 41% 39% 41% 46% 42% 39% Jewelry N/A N/A 26% 26% 25% 25% 25% 24% Health/Beauty N/A N/A 19% 22% 20% 17% 19% 24% Apparel/Accessories N/A N/A 14% 13% 14% 12% 13% 13% Average Price Point N/A $47.82 $50.06 $47.36 46.21 $47.36 $47.69 $45.41 HSN cable / DBS HH (end of period) 60.6 65.9 68.4 69.5 71.5 73.4 73.4 72.6 HSN total HH (end of period) 73.7 77.1 80.2 82.8 82.8 83.0 83.0 74.9 America's Store FTE's (end of period) 8.3 8.8 8.4 9.4 10.8 11.6 11.6 11.2 USA Networks, Inc. (to be renamed USA Interactive) Operating Metrics IN MILLIONS EXCEPT PER TICKET THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on April 24, 2002.
1999 2000 2001 2002 YE YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE ------------------------------------------------------------------------------------------- TICKETING Number of tickets sold 75.0 83.0 23.6 23.5 19.3 20.3 86.7 23.9 Gross value of tickets sold $2,781 $3,256 $937 $1,016 $788 $870 $3,611 $997 Share of tickets sold online 13.4% 24.5% 29.5% 33.2% 31.9% 33.9% 32.1% 37.8% Online ticketing revenue $69.0 $140.6 $49.6 $59.8 $44.6 $46.8 $200.8 $62.2 Revenue per ticket $5.25 $ 5.71 $ 5.96 $6.29 $6.20 $ 6.00 $ 6.11 $ 5.97 USA Networks, Inc. (to be renamed USA Interactive) Operating Metrics IN THOUSANDS THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on April 24, 2002.
2000 2001 2002 YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE -------------------------------------------------------------------------------------------- MATCH.COM Paid subscribers 156.9 189.5 216.6 252.7 382.2 382.2 527.7 New registrations 1,135.6 1,054.7 1,059.5 1,216.0 2,304.0 5,634.3 2,911.7 New subscriptions (first time only) 399.5 121.7 134.8 154.2 260.4 671.0 342.4 Conversion rate (Reg to Subs) 35.2% 11.5% 12.7% 12.7% 11.3% 11.9% 11.8% USA Networks, Inc. (to be renamed USA Interactive) Operating Metrics
1999 2000 2001 YE YE Q1 Q2 Q3 Q4 YE ---------------------------------------------------------------------------------- HOTEL RESERVATIONS NETWORK Hotel room nights sold (thousands) 1,229 2,433 799 1,030 1,227 1,187 4,243 Average Daily Rate N/A $131.70 $124.35 $129.60 $120.30 $112.40 $121.10 Affiliates (including TravelNow) N/A 16,200 18,649 20,857 22,793 23,808 23,808 Properties 1,500 2,600 3,084 3,374 3,890 4,567 4,567 Cities served 40 97 135 146 171 178 178 IN THOUSANDS 2000 2001 YE Q1 Q2 Q3 Q4 YE ---------------------------------------------------------------------------------- EXPEDIA Total gross bookings (a) $1,793,000 $674,000 $802,000 $723,000 $704,000 $2,903,000 Total transactions (b) 4,832 1,780 2,241 2,222 2,229 8,472 Average monthly Media Metrix reach (c) N/A 6,969 7,502 9,410 9,238 N/A Expedia.com conversion (d) N/A 5.7% 7.0% 5.5% 5.2% N/A Expedia new purchasing customers (e) 1,769 671 904 918 870 3,363 Expedia cumulative purchasing customers (f) 8,843 3,603 4,507 5,424 6,294 19,828 Expedia quarterly unique purchasing customers (g) 2,741 1,007 1,336 1,393 1,383 5,119 A Gross bookings represents the total value of travel booked through the Expedia, VacationSpot, and WWTE sites. B Transactions represents the number of reservations and purchases transacted through the Expedia and WWTE sites. C Average monthly Media Metrix reach represents the unduplicated reach for the Expedia and VacationSpot sites. D Conversion represents the monthly average Expedia.com unique monthly purchasers divided by the monthly average Media Metrix reach for the Expedia.com site. E Expedia new purchasing customers represents the number of new customers transacting through the Expedia sites in a quarter. F Expedia cumulative purchasing customers represents the cumulative number of customers that have ever transacted through the Expedia sites as of the end of a quarter. G Expedia quarterly unique purchasing customers represents the number of unique customers transacting through the Expedia sites over the course of a quarter. The financial, statistical and other information contained herein is unaudited. As filed with the Securities and Exchange Commission on April 29, 2002.
2002 Q1 Q2 Q3 Q4 YE ------------------------------------------------------------ HOTEL RESERVATIONS NETWORK Hotel room nights sold (thousands) 1,408 Average Daily Rate $115.70 Affiliates (including TravelNow) 25,755 Properties 6,058 Cities served 218 IN THOUSANDS 2002 Q1 Q2 Q3 Q4 YE ------------------------------------------------------------ EXPEDIA Total gross bookings (a) 1,107,000 Total transactions (b) 3,045 Average monthly Media Metrix reach (c) 11,242 Expedia.com conversion (d) 5.8% Expedia new purchasing customers (e) 1,316 Expedia cumulative purchasing customers (f) 7,610 Expedia quarterly unique purchasing customers (g) 1,874 USA Networks, Inc. (to be renamed USA Interactive) Operating Metrics IN MILLIONS CAPITALIZATION (pro forma for pending transactions) (AS OF 4/15/02) Outstanding equity cap $14.2 billion Fully diluted equity cap $15.2 billion INCLUDES TREASURY METHOD OPTIONS AND WARRANTS, EXCHANGEABLE SHARES AND OTHER DILUTIVE SECURITIES, AND INCLUDES VIVENDI'S REMAINING 56.6 MILLION USA SHARES THAT MAY BE DELIVERED TO USA IN CONNECTION WITH USA'S SERIES B PREFERRED INTEREST IN VUE, WHICH WILL BE ISSUED TO USA IN THE PENDING VIVENDI TRANSACTION. BUSINESS MIX
Ticker (NASDAQ) USAI USAi Common Stock 349.7 USAi Class B 63.0 USAi Exchangeable Common Stock 31.6 USAi Exchangeable Class B 1.6 --------------- Total Shares Outstanding 445.9 Estimated dilutive options and warrants (treasury method) 31.5 --------------- Fully diluted shares 477.4 =============== THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on April 24, 2002.
Revenue sources (Q1 '02): Merchandise 46% Online travel/hotel rooms 28% Ticketing 15% Teleservices / ECS 8% Personals 3% ----------- Commerce 100% =========== Interactive (online and TV) (% of total) 83% International (% of total) 11%